One interesting observation I've made over the last few years is about the myth of the overnight success. This is a persistent idea in the startup world (much like in any star-dominated field) - the idea that someone is unknown and unsuccessful for many years, and suddenly they shoot to fame through a combination of luck, timing, hard work, perseverance, and other assorted goodies.

The problem with this myth is that it's true, but it's also misleading. For most of my working life, I was under the spell of this "some day it will all change" myth. Having observed both myself and other successful people around me, I found that this is not true.

Rather than having a long history of self-sacrifice followed by a sudden rise to fame, successful people (even those that shoot to fame) seem to have a long history of building bigger successes on top of smaller successes. In other words, as the title puts it, successful people are successful - for a long time before you get to hear about them. Success seems to be a lifelong habit.

Does success provide compounding returns?

This is obvious if you only consider financial success. If you want to get wealthy, you have two approaches: count on a lottery ticket type of event (e.g. winning the lottery, or winning the startup lottery...), or set out building, growing and maintaining a base of wealth. Ignoring those who choose the first path (because they are clearly irrational), if you look at the behaviours of people who tend to go from little wealth to a lot more wealth, you can observe that they tend to make decisions that optimise how much money they make (this sounds obvious, but is actually quite an insight).

They'll work in jobs that pay more, or start businesses that make money. In my experience, those who have a fair bit of money are not profligate - they spend sensibly, agonise over larger expenses, are conscious of having to maintain and grow their savings, and so on. Whereas the average person will optimise for today's enjoyment (and that may well be the right choice for many), those who are money-minded tend to optimise for accumulating more money and spending less money. All these decisions add up over the decades, and they also compound over each other. When you have £100k in the bank, you can make wealth-preserving decisions (e.g. buying some Apple stock a few years ago!) that will provide a much larger return than what you could do when you have just £10k or even £0.

Because of all this, the difference between someone who consistently makes decisions that preserve and augment wealth, and those who don't, can easily get to be very large.

With non-financial success, this process is much harder to observe, but I think it's still a big factor. Decades of making successful decisions that add to whatever it is you want to do will pile up and compound and get you there. Waiting for that one big hit to get you to the stars, on the other hand, will not. Smaller successes build up your "success wealth", in the form of experience, connections, wisdom, knowledge, skill, and so on.

Self-sacrifice

And yet we perpetuate the myth of the silently suffering, self-effacing, self-sacrificing hard worker who one day is finally rewarded for his or her efforts.

Having a self-sacrifice mind-set means consistently making decisions that benefit someone or something other than yourself, and often at a cost to yourself. Our culture often regards this as noble - perhaps it's a behaviour that makes society function better. It's a useful meme to keep around when you've already succeeded, certainly, but I don't think it serves us too well as individuals.

Having a self-sacrifice mindset means that, speaking metaphorically, you often make decisions that, instead of adding 10 points to your "success score", reduce it by a few points, and add a few more points to other people's. Having a self-sacrifice mindset means you consistently neglect your own success to achieve some higher objective - political, scientific, economic, social, etc. Having a self-sacrifice mindset means, I believe, that you are vanishingly unlikely to actually succeed at your lofty ambitions (assuming you have lofty ambitions, of course).

This is an extremely common mindset in the startup world. Many people think it makes sense to sacrifice everything for some elusive success that's waiting a few years down the line when their startup makes it big. They'll sacrifice their health, their social life, their appearance, their savings, their house, they'll quit their jobs, break up relationships that couldn't stand the pressure cooker, stop learning new things because "now is the time to get things done", and "there'll be time to have fun later, after the startup is out of the way".

In view of my observations above, that's a hugely damaging myth. I can reasonably state that, as far as I'm concerned, at least, this myth has cost me years of productive life. I personally could be much further towards my own objectives without this myth.

So what should we do instead?

Growth

An important way to solve this is to replace the idea of self-sacrifice with that of personal growth. Instead of making choices that benefit others, make choices that benefit yourself. Avoid things that cost you right now and have only a small chance of providing a return later (and be aware that we tend to be over-optimistic about what will happen later).

When faced with a choice to sacrifice something of yours (typically your time) for a so-called higher objective, reject that choice. Instead, find a way to make it a "win-win" - where you grow as a person and come out of it further ahead, no matter whether the higher objective is achieved. If you're going to work on a startup, plan things out so that even if it fails without making a single ripple, you'll still be better off after than you were before.

In other words, always optimise for personal growth, for building your "success pool" that you can leverage to go from smaller successes to bigger successes. Steer away from choices that reduce this personal asset.

Growth decisions provide you with:

new knowledge and skills

financial wealth

connections

valuable experience that you could not get in any other way

time and energy to do more things (or fewer things)

more control

This checklist can be useful when making decisions. Any decision that goes against one of these objectives (e.g. reduces your control, your connections, your skills) probably involves some amount of self-sacrifice and should be regarded with suspicion.

This isn't to say that we should all become selfish beasts concerned only with ourselves. We are lucky to live in a world where most of the really great opportunities involve delivering growth for many people at the same time. I'm not suggesting that we should focus only on personal growth - just that every decision should be optimised so that personal growth is part of the deal, and self-sacrifice is not.

I strongly believe that applying this mindset consistently for a long period of time can make an enormous difference to where you will end up.

By Madison Ruppert - End The Lie
SOPA would put completely legitimate sites, like End the Lie and countless other alternative news outlets at risk of being shut down, along with literally any site that freely allows users to post content.That includes YouTube, Facebook, Twitter, WordPress, Blogger, Craigslist, Dropbox and literally any website or service that allows users to upload content.
The United ...

(By AlterNet) The ruling elite has created social institutions that have subdued young Americans and broken their spirit of resistance.
Traditionally, young people have energized democratic movements. So it is a major coup for the ruling elite to have created societal institutions that have subdued young Americans and broken their spirit of resistance to domination.
Young Americans—even more so than older A...

6th December 2011
By Gretchen Rubin - realsimple.com
1. Raise your activity level to pump up your energy. If you're on the phone, stand up and pace. Take the stairs instead of the elevator. Put more energy into your voice. Take a brisk 10-minute walk. Even better...
2. Take a walk outside. Research suggests that light stimulates brain chemicals that improve mood. For an extra boost, get your sunlight first t...

Heidemarie Schwermer, a 69-year-old woman from Germany, gave up using money 15 years ago and says she’s been much happier ever since.
Heidemarie’s incredible story began 22 years ago, when she, a middle-aged secondary school teacher emerging from a difficult marriage, took her two children and moved to the city of Dortmund, in Germany’s Ruhr area. One of the first things she noticed was the large number of home...

By DailyGalaxy.com
What if our existence is a holographic projection of another, flat version of you living on a two-dimensional "surface" at the edge of this universe? In other words, are we real, or are we quantum interactions on the edges of the universe - and is that just as real anyway?
Whether we actually live in a hologram is being hotly debated, but it is now becoming clear that looking at phenomena...

The Discovery of Dolphin Language

28th November 2011

Researchers in the United States and Great Britain have made a significant breakthrough in deciphering dolphin language in which a series of eight objects have been sonically identified by dolphins. Team leader, Jack Kassewitz of SpeakDolphin.com, ‘spoke’ to dolphins with the dolphin’s own sound picture words. Dolphins in two separate research centers understood the words, presenting convincing evidence that dolphins employ a universal “sono-pictorial” language of communication.

The team was able to teach the dolphins simple and complex sentences involving nouns and verbs, revealing that dolphins comprehend elements of human language, as well as having a complex visual language of their own. Kassewitz commented,

We are beginning to understand the visual aspects of their language, for example in the identification of eight dolphin visual sounds for nouns, recorded by hydrophone as the dolphins echo located on a range of submersed plastic objects.

The British member of the research team, John Stuart Reid, used aCymaScope instrument, a device that makes sound visible, to gain a better understanding of how dolphins see with sound. He imaged a series of the test objects as sono-pictorially created by one of the research dolphins. In his bid to “speak dolphin” Jack Kassewitz of SpeakDolphin.com, based in Miami, Florida, designed an experiment in which he recorded dolphin echolocation sounds as they reflected off a range of eight submersed objects, including a plastic cube, a toy duck and a flowerpot. He discovered that the reflected sounds actually contain sound pictures and when replayed to the dolphin in the form of a game, the dolphin was able to identify the objects with 86% accuracy, providing evidence that dolphins understand echolocation sounds as pictures. Kassewitz then drove to a different facility and replayed the sound pictures to a dolphin that had not previously experienced them. The second dolphin identified the objects with a similar high success rate, confirming that dolphins possess a sono-pictorial form of communication. It has been suspected by some researchers that dolphins employ a sono-visual sense to ‘photograph’ (in sound) a predator approaching their family pod, in order to beam the picture to other members of their pod, alerting them of danger. In this scenario it is assumed that the picture of the predator will be perceived in the mind’s eye of the other dolphins.

When Reid imaged the reflected echolocation sounds on the CymaScope it became possible for the first time to see the sono-pictorial images that the dolphin created. The resulting pictures resemble typical ultrasound images seen in hospitals. Reid explained:

When a dolphin scans an object with its high frequency sound beam, emitted in the form of short clicks, each click captures a still image, similar to a camera taking photographs. Each dolphin click is a pulse of pure sound that becomes modulated by the shape of the object. In other words, the pulse of reflected sound contains a semi-holographic representation of the object. A portion of the reflected sound is collected by the dolphin’s lower jaw, its mandible,where it travels through twin fat-filled ‘acoustic horns’ to the dolphin’s inner ears to create the sono-pictorial image.

Click To Enlarge

The precise mechanism concerning how the sonic image is ‘read’ by the cochleae is still unknown but the team’s present hypothesis is that each click-pulse causes the image to momentarily manifest on the basilar and tectorial membranes, thin sheets of tissue situated in the heart of each cochlea. Microscopic cilia connect with the tectorial membrane and ‘read’ the shape of the imprint, creating a composite electrical signal representing the object’s shape. This electrical signal travels to the brain via the cochlea nerve and is interpreted as an image. (The example in the graphic shows a flowerpot.) The team postulates that dolphins are able to perceive stereoscopically with their sound imaging sense. Since the dolphin emits long trains of click-pulses it is believed that it has persistence of sono-pictorial perception, analogous to video playback in which a series of still frames are viewed as moving images.

Reid said, “The CymaScope imaging technique substitutes a circular water membrane for the dolphin’s tectorial, gel-like membrane and a camera for the dolphin’s brain. We image the sono-picture as it imprints on the surface tension of water, a technique we call ‘bio-cymatic imaging,’ capturing the picture before it expands to the boundary. We think that something similar happens in the dolphin’s cochleae where the sonic image, contained in the reflected click-pulse, travels as a surface acoustic wave along the basilar and tectorial membranes and imprints in an area that relates to the carrier frequency of the click-pulse. With our bio-cymatic imaging technique we believe we see a similar image to that which the dolphin sees when it scans an object with sound. In the flowerpot image the hand of the person holding it can even be seen. The images are rather fuzzy at present but we hope to enhance the technique in future.

I find the dolphin mechanism for sonic imaging proposed by Jack Kassewitz and John Stuart Reid plausible from a scientific standpoint. I have long maintained that dolphins have a sono-visual language so I am naturally gratified that this latest research has produced a rational explanation and experimental data to verify my conjectures. As early as 1994, in a book I wrote for children, Dilo and the Call of the Deep, I referred to Dilo’s ‘Magic Sound’ as the method by which Dilo and his mother pass information between each other using sonic imaging, not just of external visual appearances, but also of internal structures and organs.

As a result of Reid’s bio-cymatic imaging technique Kassewitz, in collaboration with research intern Christopher Brown, of the University of Central Florida, is beginning to develop a new model of dolphin language that they are calling Sono-Pictorial Exo-holographic Language, (SPEL). Kassewitz explained,

The ‘exo-holographic’ part of the acronym derives from the fact that the dolphin pictorial language is actually propagated all around the dolphin whenever one or more dolphins in the pod send or receive sono-pictures. John Stuart Reid has found that any small part of the dolphin’s reflected echolocation beam contains all the data needed to recreate the image cymatically in the laboratory or, he postulates, in the dolphin’s brain. Our new model of dolphin language is one in which dolphins can not only send and receive pictures of objects around them but can create entirely new sono-pictures simply by imagining what they want to communicate. It is perhaps challenging for us as humans to step outside our symbolic thought processes to truly appreciate the dolphin’s world in which, we believe, pictorial rather than symbolic thoughts are king. Our personal biases, beliefs, ideologies, and memories penetrate and encompass all of our communication, including our description and understanding of something devoid of symbols, such as SPEL. Dolphins appear to have leap-frogged human symbolic language and instead have evolved a form of communication outside the human evolutionary path. In a sense we now have a ‘Rosetta Stone’ that will allow us to tap into their world in a way we could not have even conceived just a year ago. The old adage, ‘a picture speaks a thousand words’ suddenly takes on a whole new meaning.

Click To Enlarge

David M. Cole, founder of the The Aqua Thought Foundation, a research organization that studied human-dolphin interaction for more than a decade said,“Kassewitz and Reid have contributed a novel model for dolphins’ sonic perception, which almost certainly evolved out of the creature’s need to perceive its underwater world when vision was inhibited. Several conventional linguistic approaches to understanding dolphin communication have dead-ended in the last 20 years so it is refreshing to see this new and highly-nuanced paradigm being explored.”

The human capacity for language involves the acquisition and use of a complex system of vocal sounds to which we attribute specific meanings. Language, the relationship between sounds and meanings evolved differently for each tribe of humans and for each nation. It is generally believed that the human language faculty is fundamentally different from that of other species and of a much higher complexity. The development of vocal language is believed to have coincided with an increase in brain volume. Many researchers have wondered why dolphins have brains comparable in size with those of humans, considering that Nature creates organs according to need. The Kassewitz team’s findings suggest the large dolphin brain is necessary for the acquisition and utilization of a sono-pictorial language that requires significant brain mass.

Dolphins enjoy constant auditory and visual stimulation throughout their lives, a fact that may contribute to their hemispheric brain coordination. The dolphin’s auditory neocortical fields extend far into the midbrain, influencing the motor areas in sucha way as to allow the smooth regulation of sound-induced motor activity as well as sophisticated phonation needed for production of signature whistles and sono-pictures. These advantages are powered not only by a brain that is comparable insize to that of a human but also by a brain stem transmission time that is considerably faster than the human brain.

Kassewitz said,

Our research has provided an answer to an age-old question highlighted by Dr Jill Tarter of the SETI Institute, ‘Are we alone?’ We can now unequivocally answer, ‘no.’ SETI’s search for non-human intelligence in outer spacehas been found right here on earth in the graceful form of dolphins.

Full results of this research are available on request. Please email either Jack Kassewitz or Stuart Reid.

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The 100 Rules for Being an Entrepreneur

If you Google “entrepreneur” you get a lot of mindless cliches like “Think Big!” For me, being an “entrepreneur” doesn’t mean starting the next “Faceook”. Or even starting any business at all. It means finding the challenges you have in your ife, and determining creative ways to overcome those challenges. However, in this post I focus mostly on the issues that come up when you first start your company. These rules also apply if you are taking an entrepreneurial stance within a much larger company (which all employees should do).

(this is BS)

For me, I’ve started several businesses. As I’ve described in the rest of this blog, some have succeeded, many have failed. I’m invested in about 13 private companies. I’ve advised probably another 50 private companies. Along the way I’ve compiled a list of rules that have helped me deal with every aspect of being an entrepreneur in business and some in life.

[Btw, Claudia thinks I shouldn’t put this post up. This is going to be a chapter in a book I am self-publishing in a week or so: “How to be the Luckiest Man Alive”. But I’m trying to price the book for free on Kindle so why not? Plus, once I write something, I can’t help myself. I have to put it up.]

Here’s the real rules:

A) It’s not fun. I’m not going to explain why it’s not fun. These are rules. Not theories. I don’t need to prove them. But there’s a strong chance you can hate yourself throughout the process of being an entrepreneur. Keep sharp objects and pills away during your worst moments. And you will have them. If you are an entrepreneur and agree with me, please note this in the comments below.

B) Try not to hire people. You’ll have to hire people to expand your business. But it’s a good discipline to really question if you need each and every hire.

D) If you are offering a service, call it a product. Oracle did it. They claimed they had a database. But if you “bought” their database they would send in a team of consultants to help you “install” the database to fit your needs. In other words, for the first several years of their existence, they claimed to have a product but they really were a consulting company. Don’t forget this story. Products are valued higher than services.

E) It’s OK to fail. Start over. Hopefully before you run out of money. Hopefully before you take in investor money. Or, don’t worry about it. Come up with new ideas. Start over.

F) Be profitable. Try to be profitable immediately. This seems obvious but it isn’t. Try not to raise money. That money is expensive.

G) When raising money: if it’s not easy then your idea is probably incapable of raising money. If its easy, then take as much as possible. If its TOO easy, then sell your company (unless you are Twitter, etc).

(if its too easy, sell your company)

H) The same goes for selling your company. If it’s not easy, then you need to build more. Then sell. To sell your company, start getting in front of your acquirers a year in advance. Send them monthly updates describing your progress. Then, when they need a company like yours, your company is the first one that comes to mind.

I) Competition is good. It turns you into a killer. It helps you judge progress. It shows that other people value the space you are in. Your competitors are also your potential acquirors.

J) Don’t use a PR firm. Except maybe as a secretary. You are the PR for your company. You are your companys brand. You personally.

K) Communicate with everyone. Employees. Customers. Investors. All the time. Every day.

L) Do everything for your customers. This is very important. Get them girlfriends or boyfriends. Speak at their charities. Visit their parents for Thanksgiving. Help them find other firms to meet their needs. Even introduce them to your competitors if you think a competitor can help them or if you think you are about to be fired. Always think first, “What’s going to make my customer happy?”

M) Your customer is not a company. There’s a human there. What will make my human customer happy? Make him laugh. You want your customer to be happy.

N) Show up. Go to breakfast/lunch/dinner with customers. Treat.

O) History. Know the history of your customers in every way. Company history, personal history, marketing history, investing history, etc.

P) Micro-manage software development. Nobody knows your product better than you do. If you aren’t a technical person, learn how to be very specific in your product specification so that your programmers can’t say: “well you didn’t say that!”

Q) Hire local. You need to be able to see and talk to your programmers. Don’t outsource to India. I love India. But I won’t hire programmers from there while I’m living in the US.

R) Sleep. Don’t buy into the 20 hours a day entrepreneur myth. You need to sleep 8 hours a day to have a focused mind.

S) Exercise. Same as above. If you are unhealthy, your product will be unhealthy.

T) Emotionally Fit. DON’T have dating problems and software development problems at the same time. VCs will smell this all over you.

U) Pray. You need to. Be grateful where you are. And pray for success. You deserve it. Pray for the success of your customers. Heck, pray for the success of your competitors. The better they do, it means the market is getting bigger. And if one of them breaks out, they can buy you.

V) Buy your employees gifts. Massages. Tickets. Whatever. I always imagined that at the end of each day my young, lesbian employees (for some reason, most employees at my first company were lesbian) would be calling their parents and their mom and dad would ask them: “Hi honey! How was your day today?” And I wanted them to be able to say: “It was the best!” Invite customers to masseuse day.

W) Treat your employees like they are your children. They need boundaries. They need to be told “no!” sometimes. And sometimes you need to hit them in the face (ha ha, just kidding). But within boundaries, let them play.

X) Don’t be greedy pricing your product. If your product is good and you price it cheap, people will buy. Then you can price upgrades, future products, and future services more expensive. Which goes along with the next rule.

Y) Distribution is everything. Branding is everything. Get your name out there, whatever it takes. The best distribution is of course word of mouth, which is why your initial pricing doesn’t matter.

Z) Don’t kill yourself. It’s not worth it. Your employees need you. Your children or future children need you. It seems odd to include this in a post about entrepreneurship but we’re also taking about keeping it real. Most books or “rules” for entrepreneurs talk about things like “think big”, “go after your dreams”. But often dreams turn into nightmares. I’ll repeat it again. Don’t kill yourself. Call me if things get too stressful. Or more importantly, make sure you take proper medication

AA) Give employees structure. Let each employee know how his or her path to success can be achieved. All of them will either leave you or replace you eventually. That’s OK. Give them the guidelines how that might happen. Tell them how they can get rich by working for you.

BB) Fire employees immediately. If an employee gets “the disease” he needs to be fired. If they ask for more money all the time. If they bad mouth you to other employees. If you even think they are talking behind your back, fire them. The disease has no cure. And it’s very contagious. Show no mercy. Show the employee the door. There are no second chances because the disease is incurable.

CC) Make friends with your landlord. If you ever have to sell your company, believe it or not, you are going to need his signature (because there’s going to be a new lease owner)

DD) Only move offices if you are so packed in that employees are sharing desks and there’s no room for people to walk.

EE) Have killer parties. But use your personal money. Not company money. Invite employees, customers, and investors. It’s not the worst thing in the world to also invite off duty prostitutes or models.

FF) If an employee comes to you crying, close the door or take him or her out of the building. Sit with him until it stops. Listen to what he has to say. If someone is crying then there’s been a major communication breakdown somewhere in the company. Listen to what it is and fix it. Don’t get angry at the culprit’s. Just fix the problem.

(you don't want your employees to be sad.)

GG) At Christmas, donate money to every customer’s favorite charity. But not for investors or employees.

HH) Have lunch with your competitors. Listen and try not to talk. One competitor (Bill Markel from Interactive 8) once told me a story about how the CEO of Toys R Us returned his call. He was telling me this because I never returned Bill’s calls. Ok, Bill, lesson noted.

II) Ask advice a lot. Ask your customers advice on how you can be introduced into other parts of their company. Then they will help you. Because of the next rule…

JJ) Hire your customers. Or not. But always leave open the possibility. Let it always dangle in the air between you and them. They can get rich with you. Maybe. Possibly. If they play along. So play.

KK) On any demo or delivery, do one extra surprise thing that was not expected. Always add bells and whistles that the customer didn’t pay for.

LL) Understand the demographic changes that are changing the world. Where are marketing dollars flowing and can you be in the middle. What services do aging baby boomers need? Is the world running out of clean water? Are newspapers going to survive? Etc. Etc. Read every day to understand what is going on.

LLa) Don’t go to a lot of parties or “meetups” with other entrepreneurs. Work instead while they are partying.

MM) But, going along with the above rule, don’t listen to the doom and gloomers that are hogging the TV screen trying to tell you the world is over. They just want you to be scared so they can scoop up all the money.

NN) You have no more free time. In your free time you are thinking of new ideas for customers, new ideas for services to offer, new products.

OO) You have no more free time, part 2. In your free time, think of ideas for potential customers. Then send them emails: “I have 10 ideas for you. Would really like to show them to you. I think you will be blown away. Here’s five of them right now.”

PP) Talk. Tell everyone you ever knew what your company does. Your friends will help you find clients.

QQ) Always take someone with you to a meeting. You’re bad at following up. Because you have no free time. So, if you have another employee. Let them follow up. Plus, they will like to spend time with the boss. You’re going to be a mentor.

RR) If you are consumer focused: your advertisers are your customers. But always be thinking of new services for your consumers. Each new service has to make their life better. People’s lives are better if: they become healthier, richer, or have more sex. “Health” can be broadly defined.

SS) If your customers are advertisers: find sponsorship opportunities for them that drive customers straight into their arms. These are the most lucrative ad deals (see rule above). Ad inventory is a horrible business model. Sponsorships are better. Then you are talking to your customer.

TT) No friction. The harder it is for a consumer to sign up, the less consumers you will have. No confirmation emails, sign up forms, etc. The easier the better.

TTA) No fiction, part 2. If you are making a website, have as much content as you can on the front page. You don’t want people to have to click to a second or third page if you can avoid it. Stuff that first page with content. You aren’t Google. (And, 10 Unusual Things You Didn’t Know About Google)

UU) No friction, part 3. Say “yes” to any opportunity that gets you in a room with a big decision maker. Doesn’t matter if it costs you money.

VV) Sell your company two years before you sell it. Get in the offices of the potential buyers of your company and start updating them on your progress every month. Ask their advice on a regular basis in the guise of just an “industry catch-up”

WW) If you sell your company for stock, sell the stock as soon as you can. If you are selling your company for stock it means:

a. The market is such that lots of companies are being sold for stock.

b. AND, companies are using stock to buy other companies because they value their stock less than they value cash.

c. WHICH MEANS, that when everyone’s lockup period ends, EVERYONE will be selling stock across the country. So sell yours first.

XX) Ideas are worthless. If you have an idea worth pursuing, then just make it. You can build any website for cheap. Hire a programmer and make a demo. Get at least one person to sign up and use your service. If you want to make Facebook pages for plumbers, find one plumber who will give you $10 to make his Facebook page. Just do it.

YY) Don’t use a PR firm, part II. Set up a blog. Tell your personal stories (see “33 tips to being a better writer” ). Let the customer know you are human, approachable, and have a real vision as to why they need to use you. Become the voice for your industry, the advocate for your products. If you make skin care products, tell your customers every day how they can be even more beautiful than they currently are and have more sex than they are currently getting. Blog your way to PR success. Be honest and bloody.

ZZ) Don’t save the world. If your product sounds too good to be true, then you are a liar.

ZZa) Your company is always for sale.

AAA) Frame the first check. I’m staring at mine right now.

BBB) No free time, part 3. Pick a random customer. Find five ideas for them that have nothing to do with your business. Call them and say, “I’ve been thinking about you. Have you tried this?”

DDD) Your lawyer or accountant is not going to introduce you to any of their other clients. Those meetings are always a waste of time.

EEE) Celebrate every success. Your employees need it. They need a massage also. Get a professional masseuse in every Friday afternoon. Nobody leaves a job where there is a masseuse.

FFF) Sell your first company. Don’t take any chances. You don’t need to be Mark Zuckerberg. Sell your first company as quick as you can. You now have money in the bank and a notch on your belt. Make a billion on your next company.

GGG) Pay your employees before you pay yourself.

HHH) Give equity to get the first customer. If you have no product yet and no money, then give equity to a good partner in exchange for them being a paying customer. Note: don’t blindly give equity. If you develop a product that someone asked for, don’t give them equity. Sell it to them. But if you want to get a big distribution partner whose funds can keep you going forever, then give equity to nail the deal.

Questions from Readers

Question: You say no free time but you also say keep emotionally fit, physically fit, etc. How do I do this if I’m constantly thinking of ideas for old and potential customers?

Answer: It’s not easy or everyone would be rich.

Question: if I get really stressed about clients paying, how do I get sleep at night?

Answer: medication

Question: how do I cold-call clients?

Answer: email them. Email 40 of them. It’s OK if only 1 answers. Email 40 a day but make sure you have something of value to offer.

Question: how can I find cheap programmers or designers?

Answer: if you don’t know any and you want to be cheap: use scriptlance.com, elance.com, or craigslist. But don’t hire them if they are from another country. You need to communicate with them even if it costs more money.

Question: should I hire programmers?

Answer: first…freelance. Then hire.

Question: what if I build my product but I’m not getting customers?

Answer: develop a service loosely based on your product and offer that to customers. But I hope you didn’t make a product without talking to customers to begin with?

Question: I have the best idea in the world, but for it to work it requires a lot of people to already be using it. Like Twitter.

Answer: if you’re not baked into the Silicon Valley ecosystem, then find distribution and offer equity if you have to. Zuckerberg had Harvard. MySpace had the fans of all the local bands they set up with MySpace pages. I (in my own small way) had Thestreet.com when I set up Stockpickr.com. I also had 10 paying clients when i did my first successful business fulltime.

Question: I just lost my biggest customer and now I have to fire people. I’ve never done this before. How do I do it?

Answer: one on meetings. Be Kind. State the facts. Say you have to let people go and that everyone is hurting but you want to keep in touch because they are a great employee. It was an honor to work with them and when business comes back you hope you can convince them come back. Then ask them if they have any questions. Your reputation and the reputation of your company are on the line here. You want to be a good guy. But you want them out of your office within 15 minutes. It’s a termination, not a negotiation. This is one reason why it’s good to start with freelancers.

Question: I have a great idea. How do I attract VCs?

Answer: build the product. Get a customer. Get money from customer. Get more customers. Build more services in the product. Get VC. Chances are by this point, the VCs are calling you.

Question: I want to build a business day trading.

Answer: bad idea

Question: I want to start a business but don’t know what my passion is:

Answer: same as above question. The Daily Practice turns you into a healthy Idea Machine. Plus luck will flow in from every direction.

Final rule: Things change. Every day. The title of this post, for instance, says “100 Rules”. But I gave about 70 rules (including the Q&A). Things change midway through. Be ready for it every day. In fact, every day figure out what you can change just slightly to shake things up and improve your product and company.

Throughout the rest of this blog I have examples, ideas, rules, etc. In fact, it adds up to a lot more than 100 rules. Many of the rules above are repeated in other posts ahead but use this post as a cheat sheet. If you can think of more rules for me, add them to the comments. I’ll try and put them in the upcoming book.

'Life is still far from easy in the peripheral states of the United States of Europe (as the euro zone is now known).'

Welcome to Europe, 2021. Ten years have elapsed since the great crisis of 2010-11, which claimed the scalps of no fewer than 10 governments, including Spain and France. Some things have stayed the same, but a lot has changed.

The euro is still circulating, though banknotes are now seldom seen. (Indeed, the ease of electronic payments now makes some people wonder why creating a single European currency ever seemed worth the effort.) But Brussels has been abandoned as Europe's political headquarters. Vienna has been a great success.

"There is something about the Habsburg legacy," explains the dynamic new Austrian Chancellor Marsha Radetzky. "It just seems to make multinational politics so much more fun."

The U.S. has lost its position as the best place to do business, and China and the rest of the East have so mastered the ways of the West that they're charting a whole new economic paradigm, Harvard historian Niall Ferguson says in an interview with WSJ's John Bussey. Photo courtesy of Jeff Bush.

The Germans also like the new arrangements. "For some reason, we never felt very welcome in Belgium," recalls German Chancellor Reinhold Siegfried von Gotha-Dämmerung.

Life is still far from easy in the peripheral states of the United States of Europe (as the euro zone is now known). Unemployment in Greece, Italy, Portugal and Spain has soared to 20%. But the creation of a new system of fiscal federalism in 2012 has ensured a steady stream of funds from the north European core.

Like East Germans before them, South Europeans have grown accustomed to this trade-off. With a fifth of their region's population over 65 and a fifth unemployed, people have time to enjoy the good things in life. And there are plenty of euros to be made in this gray economy, working as maids or gardeners for the Germans, all of whom now have their second homes in the sunny south.

The U.S.E. has actually gained some members. Lithuania and Latvia stuck to their plan of joining the euro, following the example of their neighbor Estonia. Poland, under the dynamic leadership of former Foreign Minister Radek Sikorski, did the same. These new countries are the poster children of the new Europe, attracting German investment with their flat taxes and relatively low wages.

But other countries have left.

David Cameron—now beginning his fourth term as British prime minister—thanks his lucky stars that, reluctantly yielding to pressure from the Euroskeptics in his own party, he decided to risk a referendum on EU membership. His Liberal Democrat coalition partners committed political suicide by joining Labour's disastrous "Yeah to Europe" campaign.

Egged on by the pugnacious London tabloids, the public voted to leave by a margin of 59% to 41%, and then handed the Tories an absolute majority in the House of Commons. Freed from the red tape of Brussels, England is now the favored destination of Chinese foreign direct investment in Europe. And rich Chinese love their Chelsea apartments, not to mention their splendid Scottish shooting estates.

In some ways this federal Europe would gladden the hearts of the founding fathers of European integration. At its heart is the Franco-German partnership launched by Jean Monnet and Robert Schuman in the 1950s. But the U.S.E. of 2021 is a very different thing from the European Union that fell apart in 2011.

* * *

It was fitting that the disintegration of the EU should be centered on the two great cradles of Western civilization, Athens and Rome. But George Papandreou and Silvio Berlusconi were by no means the first European leaders to fall victim to what might be called the curse of the euro.

Since financial fear had started to spread through the euro zone in June 2010, no fewer than seven other governments had fallen: in the Netherlands, Slovakia, Belgium, Ireland, Finland, Portugal and Slovenia. The fact that nine governments fell in less than 18 months—with another soon to follow—was in itself remarkable.

But not only had the euro become a government-killing machine. It was also fostering a new generation of populist movements, like the Dutch Party for Freedom and the True Finns. Belgium was on the verge of splitting in two. The very structures of European politics were breaking down.

Who would be next? The answer was obvious. After the election of Nov. 20, 2011, the Spanish prime minister, José Luis Rodríguez Zapatero, stepped down. His defeat was such a foregone conclusion that he had decided the previous April not to bother seeking re-election.

And after him? The next leader in the crosshairs was the French president, Nicolas Sarkozy, who was up for re-election the following April.

The question on everyone's minds back in November 2011 was whether Europe's monetary union—so painstakingly created in the 1990s—was about to collapse. Many pundits thought so. Indeed, New York University's influential Nouriel Roubini argued that not only Greece but also Italy would have to leave—or be kicked out of—the euro zone.

But if that had happened, it is hard to see how the single currency could have survived. The speculators would immediately have turned their attention to the banks in the next weakest link (probably Spain). Meanwhile, the departing countries would have found themselves even worse off than before. Overnight all of their banks and half of their nonfinancial corporations would have been rendered insolvent, with euro-denominated liabilities but drachma or lira assets.

Restoring the old currencies also would have been ruinously expensive at a time of already chronic deficits. New borrowing would have been impossible to finance other than by printing money. These countries would quickly have found themselves in an inflationary tailspin that would have negated any benefits of devaluation.

For all these reasons, I never seriously expected the euro zone to break up. To my mind, it seemed much more likely that the currency would survive—but that the European Union would disintegrate. After all, there was no legal mechanism for a country like Greece to leave the monetary union. But under the Lisbon Treaty's special article 50, a member state could leave the EU. And that is precisely what the British did.

* * *

Britain got lucky. Accidentally, because of a personal feud between Tony Blair and Gordon Brown, the United Kingdom didn't join the euro zone after Labour came to power in 1997. As a result, the U.K. was spared what would have been an economic calamity when the financial crisis struck.

With a fiscal position little better than most of the Mediterranean countries' and a far larger banking system than in any other European economy, Britain with the euro would have been Ireland to the power of eight. Instead, the Bank of England was able to pursue an aggressively expansionary policy. Zero rates, quantitative easing and devaluation greatly mitigated the pain and allowed the "Iron Chancellor" George Osborne to get ahead of the bond markets with pre-emptive austerity. A better advertisement for the benefits of national autonomy would have been hard to devise.

At the beginning of David Cameron's premiership in 2010, there had been fears that the United Kingdom might break up. But the financial crisis put the Scots off independence; small countries had fared abysmally. And in 2013, in a historical twist only a few die-hard Ulster Unionists had dreamt possible, the Republic of Ireland's voters opted to exchange the austerity of the U.S.E. for the prosperity of the U.K. Postsectarian Irishmen celebrated their citizenship in a Reunited Kingdom of Great Britain and Ireland with the slogan: "Better Brits Than Brussels."

Another thing no one had anticipated in 2011 was developments in Scandinavia. Inspired by the True Finns in Helsinki, the Swedes and Danes—who had never joined the euro—refused to accept the German proposal for a "transfer union" to bail out Southern Europe. When the energy-rich Norwegians suggested a five-country Norse League, bringing in Iceland, too, the proposal struck a chord.

The new arrangements are not especially popular in Germany, admittedly. But unlike in other countries, from the Netherlands to Hungary, any kind of populist politics continues to be verboten in Germany. The attempt to launch a "True Germans" party (Die wahren Deutschen) fizzled out amid the usual charges of neo-Nazism.

The defeat of Angela Merkel's coalition in 2013 came as no surprise following the German banking crisis of the previous year. Taxpayers were up in arms about Ms. Merkel's decision to bail out Deutsche Bank, despite the fact that Deutsche's loans to the ill-fated European Financial Stability Fund had been made at her government's behest. The German public was simply fed up with bailing out bankers. "Occupy Frankfurt" won.

Yet the opposition Social Democrats essentially pursued the same policies as before, only with more pro-European conviction. It was the SPD that pushed through the treaty revision that created the European Finance Funding Office (fondly referred to in the British press as "EffOff"), effectively a European Treasury Department to be based in Vienna.

It was the SPD that positively welcomed the departure of the awkward Brits and Scandinavians, persuading the remaining 21 countries to join Germany in a new federal United States of Europe under the Treaty of Potsdam in 2014. With the accession of the six remaining former Yugoslav states—Bosnia, Croatia, Kosovo, Macedonia, Montenegro and Serbia—total membership in the U.S.E. rose to 28, one more than in the precrisis EU. With the separation of Flanders and Wallonia, the total rose to 29.

Crucially, too, it was the SPD that whitewashed the actions of Mario Draghi, the Italian banker who had become president of the European Central Bank in early November 2011. Mr. Draghi went far beyond his mandate in the massive indirect buying of Italian and Spanish bonds that so dramatically ended the bond-market crisis just weeks after he took office. In effect, he turned the ECB into a lender of last resort for governments.

But Mr. Draghi's brand of quantitative easing had the great merit of working. Expanding the ECB balance sheet put a floor under asset prices and restored confidence in the entire European financial system, much as had happened in the U.S. in 2009. As Mr. Draghi said in an interview in December 2011, "The euro could only be saved by printing it."

So the European monetary union did not fall apart, despite the dire predictions of the pundits in late 2011. On the contrary, in 2021 the euro is being used by more countries than before the crisis.

As accession talks begin with Ukraine, German officials talk excitedly about a future Treaty of Yalta, dividing Eastern Europe anew into Russian and European spheres of influence. One source close to Chancellor Gotha-Dämmerung joked last week: "We don't mind the Russians having the pipelines, so long as we get to keep the Black Sea beaches."

***

On reflection, it was perhaps just as well that the euro was saved. A complete disintegration of the euro zone, with all the monetary chaos that it would have entailed, might have had some nasty unintended consequences. It was easy to forget, amid the febrile machinations that ousted Messrs. Papandreou and Berlusconi, that even more dramatic events were unfolding on the other side of the Mediterranean.

Back then, in 2011, there were still those who believed that North Africa and the Middle East were entering a bright new era of democracy. But from the vantage point of 2021, such optimism seems almost incomprehensible.

The events of 2012 shook not just Europe but the whole world. The Israeli attack on Iran's nuclear facilities threw a lit match into the powder keg of the "Arab Spring." Iran counterattacked through its allies in Gaza and Lebanon.

Having failed to veto the Israeli action, the U.S. once again sat in the back seat, offering minimal assistance and trying vainly to keep the Straits of Hormuz open without firing a shot in anger. (When the entire crew of an American battleship was captured and held hostage by Iran's Revolutionary Guards, President Obama's slim chance of re-election evaporated.)

Turkey seized the moment to take the Iranian side, while at the same time repudiating Atatürk's separation of the Turkish state from Islam. Emboldened by election victory, the Muslim Brotherhood seized the reins of power in Egypt, repudiating its country's peace treaty with Israel. The king of Jordan had little option but to follow suit. The Saudis seethed but could hardly be seen to back Israel, devoutly though they wished to avoid a nuclear Iran.

Israel was entirely isolated. The U.S. was otherwise engaged as President Mitt Romney focused on his Bain Capital-style "restructuring" of the federal government's balance sheet.

It was in the nick of time that the United States of Europe intervened to prevent the scenario that Germans in particular dreaded: a desperate Israeli resort to nuclear arms. Speaking from the U.S.E. Foreign Ministry's handsome new headquarters in the Ringstrasse, the European President Karl von Habsburg explained on Al Jazeera: "First, we were worried about the effect of another oil price hike on our beloved euro. But above all we were afraid of having radioactive fallout on our favorite resorts."

Looking back on the previous 10 years, Mr. von Habsburg—still known to close associates by his royal title of Archduke Karl of Austria—could justly feel proud. Not only had the euro survived. Somehow, just a century after his grandfather's deposition, the Habsburg Empire had reconstituted itself as the United States of Europe.

Small wonder the British and the Scandinavians preferred to call it the Wholly German Empire.

—Mr. Ferguson is a professor of history at Harvard University and the author of "Civilization: The West and the Rest," published this month by Penguin Press.

When I was reading Walter Isaacson’s biography on Steve Jobs it suddenly brought back memories of the FBI repeatedly hitting the buzzer for my apartment rather forcefully ten years ago. Isaacson mentions that Steve Jobs and Dr. Larry Brilliant were best friends. Flashback to ten years ago, Larry Brilliant calls the FBI and tells them I might know something about where Osama Bin Laden keeps his money. True story.

The next thing I know, someone is ringing my buzzer, “The police! We need to come up.” Then when we let them in (after I briefly considered running down the back staircase) they flashed their badges “FBI”. They said, “we had to say “police” because we didn’t want to scare anyone on the street by saying ‘FBI’. “

Uhhh. Do you really think that is the difference between inducing fear and creating a feeling of calm?

Let’s hold off on that for a second. Three other things come to mind, maybe four, when I think of Larry Brilliant.

A) First off, what a great name. It’s like he’s a mad scientist in a Flash Gordon movie (the old black and white ones, not the one where Freddie Mercury is singing while they are flying on these weird metal wings).

B) Second, when Larry was running Google.org I had an idea for him and after all we went through (the FBI?) I thought he would respond but he didn’t

C) The most valuable thing I learned from Larry Brilliant was when we were taking a break in 1999 from looking at an ancient coin collection being held in the World Trade Center. Everyone there knew Larry and from booth to booth we were sifting through the ancient Israeli coins, coins with Alexander the Great carved beautifully into 2000-year-old silver, coins that I didn’t know the history of but Larry patiently explained.

It was beautiful, interesting, and tiring, so we grabbed a coffee , sat down at a table and I asked Larry, for lack of anything else to talk about: what is the key to great negotiation? Larry was the CEO of some public company then. A company that two years later I would help the new management liquidate but that’s another story.

The reason I asked is because I consider myself a good salesperson. I don’t have many skills, but there’s always a point with each person, on each topic, where they will say “Yes” to something. So many girls said, “No”to me in high school I had to dig deep and understand where that “yes” point was so I didn’t have to go through as much agony as an adult. [See. "7 Things I Learned from my 8 Greatest Teachers"].

Negotiation is all about boundaries and finding where to put the fence so both neighbors are happy. But when you train yourself to be too eager for the “Yes” then it becomes very hard to put up a boundary where you are saying “No”.

But negotiation is almost as important as sales. By the way, it’s not as important. Much more important to get the foot in the door (the first “yes”) then have the door slammed in your face. But once the foot is in the door you have to make sure it’s not chopped off. This is negotiation.

So I had to learn negotiation the hard way. In some cases by being out-negotiated. In some cases by observing people negotiating on my behalf (which involves more divisions in profits when you can’t negotiate for yourself) and in some cases by having a guy like Brilliant give me some tips which I remembered.

How to Negotiate:

A) Have more points to discuss than the other side.

Larry said to me that day, “most people in a negotiation think it’s just about the money. If you are selling a product it costs “X”. if you are selling a company, it costs “Y”. But that’s just a small part of a negotiation. Before you sit down for a negotiation make a list of all the things that are important to you. If you are selling a company there’s issues about salary, vacation, how long are you locked up (if it’s a stock deal), who do you report to, what your title is, how long is the employment contract for, how can you get more money if your division becomes more profitable than anyone thought, how your employees will be treated, how will your business expenses be treated, what responsibilities you have, and so on and so on. Really spend time coming up with your list, depending on the negotiation.”

Then, to make his point he reached into his pocket, in the middle of this ancient coin show, and he pulled out a dime and a nickel.

“This way,” he said, “if you have more points to discuss. You can give up the nickels.” He pushed the nickel towards me. “And keep the dimes.”

B) Have a mathematical formula. In 2007 I was negotiating the sale of my company, Stockpickr.com to thestreet.com. I was negotiating “against” Steve Elkes, who was previously COO of iVillage and managed to sell ivillage to GE for $500 million where it was never seen or heard from again. [See also, "The Day Stockpickr was Going to Go Out of Business - a Story of Friendship"]

It was only later that I realized how genius Steve was at negotiation when he used this one simple trick. Before we started negotiating he came up with a simple formula that was so simple and made so much sense that it was easy for me to say “yes” to it as the basis of the negotiation. Only later did I realize what had happened.

He said, “Look, thestreet trades for 20x earnings. So the Board will agree to something half of that so the deal is immediately accretive.” I nodded my head. Made sense. I said, “let’s use next year’s earnings.” He agreed. Seemed simple. Steve said, “So we’ll take all of your ad inventory, take your expected users based on your current growth, use our CPM (cost per thousand impressions) since we will fill up your ad inventory, and then subtract out your expenses, which is really just your salary, and there we have your earnings and we’ll multiply that by 10.”

Simple formula. I nodded my head. He had already used one simple sub-trick against me which is not worth an entire bullet point but worth a mini bullet: “THE BOARD”. So suddenly it wasn’t me negotiating against Steve – he had an invisible backup in a worst case scenario. He put the element of fear in me. Some mysterious force, “the Board” could be erratic or foolhardy at the last minute so he would help me by coming up with this simple formula that the mysterious, and perhaps dangerous, board, would easily agree to.

So, the formula sounded like it made total common sense. Particulary since it seemed like he was on my side against “the Board”. I agreed. I immediately started adding up my numbers and thestreet’s CPM was common knowledge in their SEC filings. We agreed to meet in a couple of days while he “researched” what the CPM was and looked at my traffic numbers. All negotiators act dumb at first and as they “increase their knowledge” you inevitably get screwed.

We met again in a couple of days. This time he had the head of ad sales with him. Steve said, “I don’t know all these numbers myself but Tom can explain them.” This is another sub-point, ALWAYS ACT STUPID and defer to experts that everyone agrees is an expert. In other words, you are outsourcing the hard parts of the negotiation so you can remain “friends” with the other side.

Tom said, “The SEC filings say we get a $16 CPM but that’s wrong. We give away a lot of free ad inventory and we have sponsorships on specific sites so you have to subtract that from the $16. It’s really more like a $7 CPM.” Since I had already agreed to the “formula” that was the basis of the negotiation I was stuck trying to figure out if that $7 was real or if he was BS-ing me. But we spent an hour looking at it in every which way and $7 CPM was the number.

So I had to nod my head again.

Then Steve said, “and you really have other expenses: we’ll provide an office, insurance but let’s just focus on your salary as the expenses.” Uh-oh! He was giving me nickels to take the dimes! But he got me to feeling a sigh of relief to set me up for the fall.

“And some of your traffic growth simply comes from us sending you traffic so if we didn’t buy you, you wouldn’t have that growth. We would just send that traffic elsewhere. So we have to discount that slightly.”

By this point I was so eager to just agree to anything. I just wanted to plug the right numbers into the formula we had decided on. All the calculations I had been doing on my own went right out the window.

“So I guess the number is X”, he said.

And X it was. Since that’s what the formula spit out. About 1/3 of what I thought I was going to get but I had agreed to the formula. Touché, Steve.

The good side of that negotiation is that from that point, the entire deal closed in a week. The fastest I’ve ever seen a deal close. So I felt good about that. [See also, "10 Things I Learned from Jim Cramer"]

But the key I learned was:

Have everyone agree on a mathematical formula to value an asset or service.

Then when you start plugging in the variables, that’s where the real negotiation is occurring and if you know in advance that those numbers are going to be lower than thought, then you will win the negotiation and everyone will be happy when it’s over. It is always key for both sides to be happy at the end but since everything started off on a point of agreement, it is much easier to keep both sides happy at the end even if there is disappointment along the way.

C) Alternatives. This is obvious. But pulling it off is often difficult, particularly when you actually don’t have alternatives. You have to have guts and know how to make the other side feel fear.

In late 1999 I was negotiating with several partners on starting a venture capital firm. The firm was going to be called 212 Ventures.

Investcorp faxed us a term sheet. $100mm to start the fund, a good sized management fee and a good sized performance fee (I actually forget what they were, but assume it was the usual 2 and 20), and they would help us raise another $100mm. I immediately got down on my knees, clasped my hands together and started crying while begging Mark K (then at CSFB, now at DB) “Accept before they change their minds!”

And he, correctly, said, “just hold on a second. I want to spend a few days thinking about this.” We had no other real choices. And having a $200mm VC fund could mean a lot of money per year. Having zero VC experience it seemed like a miracle that anyone would offer me this opportunity. I couldn’t sleep that weekend, I so badly wanted to take the offer.

Mark didn’t like the deal. He again used the nickel and dime thing. He wanted us (versus Investcorp) to have more control over how decisions were made, he wanted more expenses paid for by the fund, he wanted a higher performance fee, etc. He had a list of demands much bigger than theirs.

He said to them, “listen, these guys have every private equity fund calling them. Every private equity fund realizes they missed the Silicon Valley boat and now wants in. I can’t stop them from choosing another fund but if you agree to these things, I can get them to agree.” He said again, “every single one of your competitors is calling these guys”. They weren’t but he correctly assumed they wouldn’t fact-check that.

Back to the sub-point from above, he used us as his “Board” to scare them and he also scared them with the fact that we were considering alternatives when I was on my knees and praying to god that he would just accept the offer.

Then he ignored them. They tried calling a few times. He didn’t call back. They emailed. He didn’t email back.

They capitulated on every one of his terms. We accepted. The rest of that story didn’t turn out so well. But that’s perhaps the topic for another article.

He used another trick in this: “no news” is actually “bad news” in negotiation. If someone is not responding to you, it means they are likely going to say “no” to you. He used that to his advantage to convince them that we really did have alternatives. So they became eager to capitulate.

As for Dr. Larry Brilliant, who cured Smallpox in India in the 70s, was Steve Jobs best friend, ran Google.org, and now runs Jeff Skoll’s charitable holdings, and the story of the FBI, “UBL” (as the FBI referred to Osama) and the mystery of UBL’s money, I will eave that for another story. This one has gone on long enough.

Dr. Larry Brilliant is the Executive Director of Google.org. In this role, Larry works with the company’s co-founders to define the mission and strategic goals of Google’s philanthropic efforts. Google.org, the umbrella organization for these efforts, includes the Google Foundation as well as Google Grants (the AdWords giving program) and the company’s major initiatives aimed at reducing global poverty, improving the health of the least advantaged in the world, and working to halt or even reverse the effects of...

Social networks seemed poised to take over the Web. This year, Facebook reached 800 million users. LinkedIn went public in a blockbuster stock offering. Twitter produced a billion tweets per week. And Google launched its own social network, Google+, attracting 25 million users in one month.

Amid the continued growth of these social networks, there has been much excitement about how the rest of the Web would soon be infused with all things "social": social search, social commerce, social deals and more. And yet the effort to socialize the rest of the Web has so far failed to live up to its promise. Why?

How Will Social Networks Evolve? What Services Will They Deliver?

David Rogers is consultant, speaker, and author of "The Network Is Your Customer." He teaches at Columbia Business School and has advised numerous companies such as SAP, Eli Lilly, and Visa. This article originally ran on The Network, Cisco's Technology News Site. The contents or opinions in this feature are independent and do not necessarily represent the views of Cisco.

Facebook's master plan, articulated by founder Mark Zuckerberg, was that once its site had built a map of everyone you've met or known, you would be able to leverage that information across the Web, to see what your "friends" are searching, buying, watching, liking or saying.

Since 2008, Facebook has attempted to roll out this strategy by using "Facebook Connect" to extend its social graph into millions of other websites, and by incorporating new functionality into its own site. Yet many of the most anticipated social integrations so far have failed to take off:

Social commerce: When Delta Airlines launched a Facebook "ticket window" last year, it was seen as the future of e-commerce, with every ticket purchase shared socially to the customer's friends. Yet, one year later, nearly all of us still buy our tickets on dedicated airline or travel sites.

Social search: When the Bing search engine started highlighting Web pages that the user's Facebook friends "liked," it heralded the arrival of a long-awaited "social search." Yet, the fraction of "liked" pages was so tiny that the social feature was nearly invisible.

Social deals: When Facebook moved into the daily deals space, it was seen as a potent challenger to Groupon. But four months later, Facebook announced it was closing its local deals business.

Social viewing: When Facebook offered its first streaming movie this spring, on a Time Warner Facebook app, it was heralded as an opportunity to make movie viewing social. Yet, this experiment failed to produce much customer interest.

At last week's F8 conference, Facebook unveiled much more ambitious efforts to integrate outside web brands into its site - from a full-fledged Netflix movie player, to a music player drawing on Spotify and several other streaming music services.

But for any of these, or other social integrations to succeed, Facebook and its partners and rivals will need to learn from past mistakes. To date, their vision of how to make the Web more social has been based on a fundamental misunderstanding of our digital behavior.

But for any of these, or other social integrations to succeed, Facebook and its partners and rivals will need to learn from past mistakes. To date, their vision of how to make the Web more social has been based on a fundamental misunderstanding of our digital behavior.

Understanding Social Graphs vs. Interest Graphs

In order for social networks to truly reshape our experience of the rest of the Web, developers must first understand the relationship between our social graphs and our interest graphs.

A social graph is a digital map that says, "This is who I know." It may reflect people who the user knows in various ways: as family members, work colleagues, peers met at a conference, high school classmates, fellow cycling club members, friend of a friend, etc. Social graphs are mostly created on social networking sites like Facebook and LinkedIn, where users send reciprocal invites to those they know, in order to map out and maintain their social ties.

An interest graph is a digital map that says, "This is what I like." As Twitter's CEO has remarked, if you see that I follow the San Francisco Giants on Twitter, that doesn't tell you if I know the team's players, but it does tell you a lot about my interest in baseball. Interest graphs are generated by the feeds customers follow (e.g. on Twitter), products they buy (e.g. on Amazon), ratings they create (e.g. on Netflix), searches they run (e.g. on Google), or questions they answer about their tastes (e.g. on services like Hunch).

The Fallacy of Social Web 1.0

The fundamental stumbling block of the social Web to date is that it has conflated social graphs with interest graphs. But in reality, who you know does not always translate into what you will like.

For example, I have a particular taste in movies. But I do not share that same taste with most of the people whom I have friended on Facebook - a motley mix of high school classmates, work colleagues, PTA committee members, and fellow jazz buffs. Nor do we, as a large and heterogeneous group, all share the same taste in travel, or fashion, or much of anything else. So when Facebook attempts to improve my movie-viewing experience by revealing the tastes of everyone in my entire social graph, the value to me is quite low.

The fundamental stumbling block of the social Web to date is that it has conflated social graphs with interest graphs. But in reality, who you know does not always translate into what you will like.

The Future of the Social Web: Integrating the Graphs

So far, the job of mapping users' social graphs has been taken up by social networking sites like Facebook and LinkedIn. Meanwhile, interest graphs have been best built by e-commerce sites such as Netflix and Amazon that focus on highly customized recommendations.

The future of a truly social Web will rely on getting these two types of graphs to work together. We are just starting to see some interesting attempts at this:

Social circles: On Google+, users explicitly place each member of their social graph into one or more "circles" based on common interests and the type of content they want to share with them. In response, Facebook has just re-launched its own feature to manage social circles.

Feed lists: Twitter's lists feature allows users to create sublists of people and brands to follow based on different topics (e.g. news headlines, favorite celebrities, fellow sports fanatics, or authors you admire).

Single-purpose graphs: Niche services aim to map out just one particular circle of shared interest, such as micro-social-network Path (for mapping your 50 closest friends), or social music site Turntable.fm (for sharing playlists with likeminded music lovers).

In the near future, we should see new and better solutions to integrating social and interest graphs.

For Now, Pick the Right Graph

Until this kind of integration is achieved, though, Web services should consider carefully when to utilize the customer's social graph, and when to use their interest graph.

Then the service should pick the graph that adds value to the customer experience. Because the real social Web will be all about the customer.

I spent the 1990's at Caltech doing research on Internet-scale publish-and-subscribe systems in which people and programs could follow topics of interest and get new, timely information about those interests. So it is with great pride that I see that the Internet-Scale Interest Graph (shortened in the press as just the "Interest Graph") has gone from theoretical "what if" to practical "confacimus" in the last decade.

A lot has been written lately about the Interest Graph, but the term is still so new that there is not even a Wikipedia article about it yet, as of April 2011.

If the Interest Graph interests you as much as me, join me after this lolcat.

Let's start with a definition:

The Interest Graph is a representation of the relationship between people and things.

In general, the things are things of interest to the people.

I believe this concept arose in contrast to the Social Graph, which is a representation of the relationship between people and other people, as popularized by Facebook starting in May 2007: en.wikipedia.org/wiki/Social_graph

In practical terms, this means the following:

The Interest Graph is WHAT people care about, not WHO people care about.

A very important aspect of the Interest Graph is that unlike the Social Graph, which is for the most part static (except for an occasional friending or unfriending), the Interest Graph is elastic, dynamic, and rapidly changing for any individual consumerbased on:

Note that searching is private but following and expressing are, for the most part, public. The Internet-Scale Interest Graph therefore aggregates implicit and explicit gestures from consumers, and is bigger than any single company's set of data about consumers.

As Karl Rinderknecht's answer points out, the Interest Graph also captures the relationship between things and other things. And as Jeff Korhan points out in the comments, an alternative definition of social graph is the relationship between social objects, in which case an interest graph is the intersection of social graphs.

I have not found the origin of the term Interest Graph, but the concepts have been around for a while. I know that the inventor of the Web has talked about "Semantic Web" (a Web of data and the relationships between them) since the 1990's: w3.org/2001/sw/SW-FAQ

Conceptually, I think of triples as PERSON RELATIONSHIP THING -- such as Adam Rifkin LIKES San Jose Sharks. The technology is fascinating, and many great minds have developed parts of the vision: infomesh.net/2001/swintro/

As Andrew Weissman points out in the comments, the Interest Graph is dynamic:

The Interest Graph is dynamic - and far from static. Adam Rifkin Likes San Jose Sharks may not be true tomorrow, or may even be true to a lesser degree of "like."

Needless to say, much work remains to be done in creating, analyzing, and commercializing the Interest Graph. Exciting!!

Fast forward to the era of Blogs and Google and Facebook and Twitter, and the Interest Graph is something that we consumers create implicitly through our behaviors using those Web-based services.

It is bigger than any one company, but they all have interest in creating, analyzing, and employing the Interest Graph to make their services better and create more opportunities for commerce.

Regarding the origin of the term, I concur with Dmitry Rokityanskiy's answer that the earliest mention of the Interest Graph that I can find on the Internet is Santiago Sir's line in September 2008, “What we envision is that there is a new dimension of interests that emerges over the social graph, you can call it the interest graph.” TechCrunch.com/2008/09/09/popego...

Consequently, Facebook rolled out its own "Open Graph" in October 2009, which is Facebook's API's for its representation of the relationship between people and things: TechCrunch.com/2009/10/29/with-o...

Meanwhile, Hunch is working on a "Taste Graph" and LinkedIn is working on the very useful interest graph of Skills and Expertise: LinkedIn.com/skills/

To me, this party is just getting started. Naval and I wrote an article in October 2010 talking about why the Interest Graph is the reason that Twitter is Massively Undervalued (see the first link below).

As for mapping it, that is a work in progress, and much remains to be done. I do know Google, Facebook, LinkedIn, and Twitter take the Interest Graph and its vision-in-progress very seriously, as do startups such as Gravity, Namesake, Tumblr, Hunch, and Quora.

The interest graph is a digital representation of your interests, the same way your social graph is a digital representation of your social connections.

An interest graph has two main types of nodes (people and interests) and two main types of links between nodes (people-interest links, and interest-interest links). When a person (Fred) has an interest in a concept (say, The SF Giants), then there is a person-interest link between Fred and The Giants. This could be a weak link (Fred only sort of cares about The Giants) or a strong link (Fred is a huge fan). Also, if time is a factor, Fred's link to The Giants could be weakening or strengthening as his interest changes. An interest-interest link is a link between interests (ok, duh...), which indicates a connection between interests. For example, The Giants are a Major League Baseball (MLB) team, the MLB is the most prestigious professional baseball league in the US, and baseball is a sport. Accordingly, there are interest-interest links between The Giants and MLB, the MLB and baseball, and baseball and sports. Interest-interest links are important for giving context to an interest and for exposing higher level interest of a person. For example, if Fred also is into The Dodgers and The Mariners, then you could use interest-interest links to discovery that Fred is really into baseball.

A number of companies are starting to build and use interest graphs. Google, Facebook and Twitter have rich interest data sets. Google knows what search results you click and when you show up on a page that runs Google ads. Facebook knows when you like/share a webpage, site, page, etc. Twitter knows what you tweet about and links that you share in tweets. A number of startups are tapping into available data or creating their own data to build interest graphs. Hunch (hunch.com), for example, is building a "taste graph" based on how you answer questions of preference. Meanwhile, Gravity (gravity.com; disclosure, my company) is using natural language processing to mine public social data (i.e, what you publicly say, share, etc. on social networks).

The world grows more and more fragmented and granular every day. There are many, many questions that cannot be answered credibly just by one's circle of friends. This is a truly exciting space.

My Interest Graph startup Ranker - is also helping to solve this, with some success (I believe our Quantcast numbers are significantly higher than any of the other startups mentioned). Ranker is a site based on lists and rankings of people, places and things. Users can easily make lists of just about everything, and because our site is powered by a semantic dataset of the aforementioned "triples" (thank you Freebase and Factual), we have the ability to aggregate individual lists and votes into master "wisdom of crowds" rankings.

We can map the interest graph to an extremely granular degree - we can tell that a visitor who votes on this list likes anchovies on pizza but hates Canadian bacon http://www.ranker.com/list/the-t...

Some people (such as myself) love to rank things. But many more people love to consume information in the easily-understood format of a list - and in the same way the best answers get voted up or down here on Quora, people participate as well, voting items up or down, and the rankings get more and more credible as the network effect kicks in.

Since these answers all pretty much cover everything, I'll try to briefly synthesize in short-form what the term "Interest Graph" means to me, definitionally:

The "Interest Graph" is the digital reflection of connecting users online around their primary (and secondary, etc.) interests with the explicit goals of (1) allowing users the chance to contribute, consume, and signal knowledge; (2) enabling users to make new connections based on interests; and (3) to create vertical-specific content that is structured from the beginning such that it optimizes for search, which may provide better and more attractive arenas for advertisers to target messages to those users.

The site that has done this the best (so far) is Quora, hands-down. No one has the topic ontology that they have built, but that's not to say others cannot.

My understanding of social graphs is that they are more than just your social connections, but also everything that is shared among them. The inferences drawn from a social graph become the interest graph.

Every time something is shared among your connections, another node is created that gives the graph more context, thereby revealing more about your interests. When the frequency of sharing increases, more clarity is created, and thus more inferences on interests can then be more easily and accurately derived from the graph.

As I see it, social graphs, interest graphs, and even Zuckerberg's Open Graph are all the same - digital maps that tell a story. If there are differences, it's mostly semantics. What I believe it comes down to is what we intend to use the data for - which for the most part is understanding and predicting future actions based upon past behaviors.

It is all very fascinating when you begin to imagine the possibilities of achieving higher levels of accurately predicting human behavior as our social graphs become more complete, and theoretically, more accurate digital replications of who we are.

Taking this a step further, our social and interest graphs will soon tell us a great deal about ourselves that we may not know, because we cannot see ourselves as others do. In other words, our communities of connections will have the power to describe by their actions who we are, which we'll have to reconcile with our own understanding.

The answer to the "what" has been well described above, but I'd like to comment on the implications of mapping together interest data. I'm excited to see where Interest graphs can lead, specifically in terms of generating and facilitating local commerce. We'll begin to see a big wave in discovery over the next five years, and it'll be interesting to see how much commerce (online, social, local) is generated by web-based tools that can tap into an interest graph and then recommend boutiques, shops, restaurants, products - and the list goes on.

My new NYC-based startup, Hoppit (http://hoppit.com), is specializing in taste graphing out local places of interest. It's our belief that consumer taste data, in correspondence with robust place data, can result in an incredibly effective recommendation engine for "place discovery." We're hoping to drive people out into the local commerce scene for new discoveries.

Our strong belief is that interest graphing can be a direct catalyst of all sorts of commerce.